Business reporter

THE corporate regulator has yet to decide whether to appeal against a reduced penalty for a key figure in the AWB oil-for-food scandal.

A Victorian Supreme Court judge yesterday threw out a deal agreed between the wheat exporter's former chief financial officer, Paul Ingleby, and the Australian Securities and Investments Commission under which Mr Ingleby was to pay a $40,000 penalty and receive a 15-month ban from managing corporations.

Mr Ingleby was not present in court yesterday to hear Justice Ross Robson reduce the payment to $10,000 and ban Mr Ingleby from managing corporations until the end of the year.

To settle the civil case, Mr Ingleby had admitted to breaching the Corporations Act by authorising AWB's payments to Jordanian trucking company Alia between 2001 and 2004, when Iraq was subject to UN sanctions.

Under the UN oil-for-food program, it was prohibited to directly pay the Hussein regime. Instead, money from Iraq's oil sales was kept in a UN-administered escrow account, and used to pay for wheat and other food supplies.

Mr Ingleby also admitted that he had information available to him to raise questions as to the legitimacy of the fees and suggesting the money was ultimately paid to the Iraqi government out of a UN escrow account.

He did not give the information to the board of AWB, he admitted.

''I find that the agreed period of disqualification and pecuniary penalty broadly speaking are too severe and fall outside the permissible range that are appropriate in all the circumstances to Mr Ingleby's contravention of the act,'' Justice Robson said.

''If the matter were left to me, but for the admission of Mr Ingleby that the contravention was serious, I may have found that it was not serious.''

An ASIC spokesman said the judgment was being reviewed and declined to comment further.

On Thursday, Justice Robson approved an agreement between ASIC and AWB's former chief executive, Andrew Lindberg, under which Mr Lindberg will pay a $100,000 penalty and accept a ban from managing corporations until September 2014.

The rulings against Mr Lindberg and Mr Ingleby dispose of two of six civil cases brought by ASIC against AWB executives who it alleges were involved in the Iraq scandal.